Financiers set tax rate that could force local budget cuts

Updated 5:21 am, Sunday, May 8, 2016

The Board of Finance adopted a new mill rate Thursday, despite uncertainty over state revenues.

The Board of Finance adopted a new mill rate Thursday, despite uncertainty over state revenues.

Photo: Genevieve Reilly / Hearst Connecticut Media

Financiers set tax rate that could force local budget cuts

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FAIRFIELD — The tax rate adopted for the 2016-17 fiscal year by the Board of Finance could mean cuts to the town and school budgets if state aid to the town is cut when the General Assembly finally agrees on a budget.

The 25.45-mill tax rate set by the finance panel Thursday will fully fund the town’s $293.5 million budget only if all of the $8.2 million in expected state revenue is restored, which appeared unlikely. If the money raised by town taxes does not cover the local spending package, First Selectman Michael Tetreau and Superintendent of Schools David Title will have to find areas to make up the shortfall.

The combined total of $8.2 million in state aid that was used to formulate the municipal budget includes $3.5 million in Education Cost Sharing money, more than $1 million sales tax sharing, $2 million in PILOT funding and other allocations. By week’s end, local officials said it appeared the town would receive about $5.9 million, a $2.29 million difference from what was built into the municipal budget, which is set to take effect July 1.

The finance board’s 5-2 vote to adopt the mill rate split along party lines, with Republicans voting in favor and the Democrats voting no. Democrat Kevin Hoffkins first attempted to get the board to postpone action on the mill rate until the May 17 meeting in order to have better information about state revenue. The General Assembly will try to resolve the state’s budget crisis in a special session scheduled Tuesday. That motion failed, with Hoffkins and fellow Democrat John Mitola voting in favor, and the five Republicans voting opposed.

Hoffkins also moved to adopt a slightly higher tax rate — 25.64 mills — to cover the anticipated state revenue shortfall. Again, the vote was along party lines and the motion failed.

At 25.45 mills, a homeowner with property assessed at the Fairfield median of $348,460 would see the tax bill increase by $230 in the new fiscal year. That increase would have risen to $296 with the rejected tax rate of 25.64 mills.

Town Attorney Stanton Lesser told the board that state statutes require the town to fully fund the municipal budget, or adopt “a tax sufficient to cover the current expenses.” If it does not, the town will end up with a budget deficit.

“If we pass a mill rate that presumes money we do not get, we’re going to have to cut services,” Hoffkins said.

But Republicans argued that they adopted a budget after careful consideration and wanted to send a message to state officials.

“If we knew Hartford was going to cut the funding a month ago, I would’ve cut the budget more,” said finance board member Mary LeClerc, a Republican.

“I have no idea what the legislature is going to do,” said Republican James Walsh. “I’ve never seen as much insanity as I’ve seen up in Hartford.” Walsh, who questioned a vote by state Rep. Cristin McCarthy Vahey, D-133, in the assembly’s Finance Committee on a $1.2 million cut to the town’s allocation of Education Cost Sharing money, said that all state communities should have received an equal cut. In Gov. Dannel Malloy’s original proposal, Fairfield was one of 11 towns that would have lost all of its ECS funding.

“To cut education money in balancing this budget is horrible,” Walsh said, “especially with all the money this town sends up to Hartford.”

Walsh’s comments drew Tetreau’s ire, who noted that Walsh himself has been a leader in attempting to making large cuts in local spending — cuts of $2 million and $1 million — in recent years. Walsh disputed that, and said Tetreau should apologize to him.

Tetreau said the Representative Town Meeting’s unanimous action Monday adopting the $293.5 million budget, with no cuts, was a statement that this was the amount of money needed to run the town, and the Board of Finance should set a mill rate to “honor” that.

But finance Chairman Thomas Flynn said the RTM’s Republican majority stated at the meeting they expect the town and school district would make the needed cuts if state funding leaves a hole in the town’s budget.